Caro applicability

Doubt !

If CARO is Applicable to the Holding Company whether it is applicable to its subsidiary on the basis that it is applicable to its holding company.

Kindly provide your valuable answer to this query? 

Replies (6)

YA, IT WILL ALSO APPLICABLE FOR SUBSIDIARY COMPANY AS WELL.

whether CARO is applicable or not, is given in CARO Clause 2, which is as below:-

CARO shall apply to every company including a foreign company as defined in section 591 of the Act, except the following::

- a Banking company as defined in clause (c) of section 5 of the Banking Regulation Act, 1949 (10 of 1949);

- an insurance company as defined in clause (21) of section 2 of the Act;

- a company licensed to operate under section 25 of the Act; and

- a private limited company with a paid-up capital and reserves not more than fifty lakh rupees and does not have loan outstanding exceeding Rupees Twenty Five lakhs from any bank or financial institution and does not have a turnover exceeding five crores rupees at any point of time during the financial year

 

Thus, CARO applies to all companies except as given above.

 

Now, you question seems wrt Pvt. Ltd. Co., so as per the definition of Pvt. Ltd. Co., there is nothing given that if holding company is ltd. company, the Pvt. Ltd. Co. will also be treated as Ltd. Co. {although that provision is incorporated in Companies Bill 2013}.

 

So, if CARO applies to Holding Co., it is not necessary that it will apply to subsidiary company also {it will apply, if it doesn't fall in exception coverage}

only if it is 100% subsidiary company...

yes...  a subsideary company will not necessary be dragged..

when will caro applicable

1. when all the conditions satisfied

or

2. when any of the conditions satisfied

CARO will be applicable if any one of the condition is fullfilled. Cluase contans "OR" means any one of the conditions ned to be fullfilled

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
Featured 27 October 2026
semi-qualified CA

Saini Pati Shah & Co LLP, Chartered Accountants

Mumbai

CA Final

View Details
Company
07 October 2026
Senior Account Manager

Amplio Invest

Mumbai

M.Com

View Details
Company
14 October 2026
Accountant

Rize.farm

Bengaluru

B.Com

View Details
Company
Featured ARTICLESHIP 28 October 2026
CA- Inter and Articles

N N V Satish & Co.,

Hyderabad

CA Inter

View Details
Company
06 October 2026
Assistant Manager - Audit and Compliance

Ravi K Jain & Co

Noida

Others

View Details
Company
Featured 29 October 2026
Accounts Executive

Synergy Keystone

Chennai

B.Com

View Details
Company
08 October 2026
SALES TELECALLER

HIRE NOVA

Lucknow

Graduate (Any)

View Details
Company
12 October 2026
Finance

I-Genext Consulting Private Limited

New Delhi

CA

View Details